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Why Are We Hauling Pennsylvania Coal All The Way To Germany?

Saturday, March 22, 2014

TAMAQUA, Pa. – There are budget earmarks from powerful congressmen, earmarks from not-so-powerful congressmen and, as it turns out for this old mining town in Pennsylvania's Appalachians, there's even an earmark from a long-dead congressman.

In the 1960s and 70s, powerful Democrat Daniel Flood worked to find a federal government buyer for the anthracite coal mined in his district. He succeeded: Some five decades later, the heat coming off the radiators at the U.S. military's installation at Kaiserslautern, Germany, is still generated by burning Pennsylvania anthracite.

Each year, the coal is dug from century-old mines in these hills and valleys, loaded onto rail cars and sent to an East Coast port, typically Baltimore. There, it's loaded onto a bulk carrier for the trans-Atlantic journey to Rotterdam.

"This is shipped from the States, and with a barge on the Rhine River, and delivered to Rhinau," says Uschi Hoermann, a civilian contracting officer for the Air Force in Germany. "They have a storage area there, and they pick up the coal as they need it."

Germany's environmental policy is to shift away from coal – which produces twice as much carbon dioxide as natural gas does for the same amount of energy. Even setting that aside, there is plenty of anthracite to be found on the European market – at a fraction of the price of American anthracite, after factoring in the shipping costs.

So why haul Pennsylvania coal all the way to Germany?

Hoermann points to a $20-million-a-year contract which requires it. And the contract requires it because, year after year, Congress has inserted into defense appropriations bills a requirement that the heating of the military bases at Kaiserslautern be done with "United States anthracite."

The Pennsylvania Connection

Eastern Pennsylvania is the only place in the United States where anthracite is mined. It's the hard, low-sulfur, low-soot form of coal that once was a mainstay in home heating and commercial power generation. But by the mid-1960s, more and more homes and utilities were switching to oil and natural gas, and away from anthracite.

"The industry was struggling, and the Pennsylvania delegation wanted to do something to help it," says Jim Dyer, who today is a lobbyist with the Podesta Group but who began his career four decades ago in the office of Pennsylvania Republican Rep. Joseph McDade. "The one way it could help it was ... to get the federal government interested in buying some of it."

Their vehicle for capturing that interest was the earmark – in this case, a mandate that the Defense Department buy upwards of a million tons of anthracite a year for heat and electricity at its overseas bases. A law was passed actually forbidding the conversion of coal-fired plants at the bases to other fuels.

By the late 1970s and 1980s, the Pentagon was pushing back hard. It complained that it had no use for all that coal – so much, in fact, that it was paving it over with asphalt to protect it from the elements. It argued that it was cheaper to buy electricity and heat from local communities.

Over time, those arguments began to win the day. Critics of the program grew in number, and dubbed the anthracite language the "Coals to Newcastle" program. Then-Texas GOP Sen. Phil Gramm called it "felony theft of the taxpayers' money."

The coal mandate started to shrink – down to 300,000 tons, and eventually to the language currently in use that requires enough to generate the hot water needed by the 50,000 American service members and dependents at Kaiserslautern. That worked out to about 9,000 tons of anthracite last year, according to Hoermann.

Why the program is still in place remains unclear.

When it started a half-century ago, the million-ton annual purchase made the Pentagon the single largest buyer of anthracite in the world. The 9,000 tons left today makes up less than 4 percent of the output of the one mine in Tamaqua that supplies the Kaiserslautern coal.

Flood left Congress in 1980 after pleading guilty to corruption charges, and died in 1994. But one of Flood's aides, Michael Clark, remained in Washington. He founded the Anthracite Industry Association and continued lobbying Congress to keep the coal language. His success was even featured in a 1983 Washington Post article by Michael Isikoff.

Today Clark is still a lobbyist – and in an unusual twist, now represents Stadtwerke Kaiserslautern, the city-owned utility that is required to burn American anthracite in its Air Force heating contract. Neither Clark nor SWK, as the utility is known, responded to queries about the lobbying services Clark has provided.

Disclosure forms filed with Congress show that SWK is Clark's sole lobbying client, and that it has paid him an average of $225,000 a year over the past decade.

The Air Force also declined requests for an interview regarding the coal-shipping policy. While it fought Congress when the requirement was a million tons a year, it's not fighting the current mandate. It said in a statement: "The Air Force follows the laws and the direction put forth by Congress."

No Groundswell To Eliminate Earmark

The member of Congress who represents Flood's old district is Democrat Matt Cartwright. He won the seat in the 2012 running as an environmentalist, and benefited from a quarter million dollars in TV ads against the conservative Democratic incumbent by the League of Conservation Voters.

At a recent public hearing he was hosting in Wilkes-Barre, he acknowledged that the coal earmark is not ideal from an environmental standpoint. But, he told NPR: "It's one of those things in Washington that if you want to dislodge it, you have to well up a force of steam to get that done. I'm not aware of any great groundswell of support to get rid of it at this point."

And, Cartwright says, he's not willing to lead that charge. "This is something that was instituted in the congressional tenure of Daniel Flood. So before you dislodge a tradition like that, you want to study it closely."

All of which means there's little chance that the late Congressman Flood's coal-to-Germany legacy earmark will be ending any time soon.

The Air Force, in fact, this past December signed a six-year extension of its heating contract for Kaiserslautern – including the requirement that it continue burning American anthracite. Copyright 2014 NPR. To see more, visit http://www.npr.org/.